Russia and India sign MoU for pipeline

It has been reported that the Indian and Russian governments are hoping to pipe natural gas from Russia to India. The two countries are interested in working together and have been studying the construction of a gas pipeline that will transport gas from Siberia to India, across approximately 2800 - 3700 miles. On 15 October, a memorandum of understanding (MoU) was signed by state-owned Engineers India Ltd. and Gazprom.

The pipeline is expected to cost up to US$25 billion, depending on the route that is chosen. If the partners choose to run the pipeline through the Himalayas and into northern India, it will be the shortest length. There are two other alternatives. First, building the pipeline through Central Asia, Iran and Pakistan, to western India or through China and Myanmar. The latter would be the most costly, infact, it would be the the world's most expensive pipeline so far.

The MoU was signed on the sidelines of the 8th BRICS summit, which was held in Benaulim, Goa, India. Gazprom sent delegations to the summit, which was for five major emerging national economies: Brazil, Russia, India, China and South Africa. During a ceremony held in India, the energy company signed the MoU that related to natural gas.

"The MoU reflects the interest of the parties in jointly exploring the routes for pipeline gas supplies from Russia and other countries to India," Gazprom said in a statement.

India is currently seeking to enhance energy security and to address its increasing need for natural gas. Meanwhile, Russia is looking to expand trade with Eastern economies in an effort to diversify its consumer base beyond Europe.

This news comes just days after Rosneft announced that it has teamed up with global commodities trader Trafigura and an investment fund, UCP, to acquire 98% of India’s Essar Oil, again, enhancing Russia’s global presence outside of Europe.